Vietnam’s new regulations on bracket of property auction fees

Regulated entities of Circular No. 45/2017/TT-BTC of the Ministry of Finance of Vietnam include: Sellers who are prescribed in Clause 5 Article 5 of the Law on property auction of Vietnam and put up property for auctions as prescribed in Clause 1, Article 4 of the Law on property auction, except for auctions conducted by a property auction council established by the competent authority; Auction companies (hereinafter referred to as auction companies) prescribed in Clause 12, Article 5 of the Law on property auction; Other organizations and individuals relating to property auction prescribed in Clause 1, Article 4 of the Law on property auction.

Circular No. 45/2017/TT-BTC also stipulates the fee bracket applicable to a property auction contract in case of successful auction is defined as follows: Minimum fee: VND 1,000,000 per contract.

Maximum fee equivalent to each bracket of property value by starting price is VND 300 million per contract.

Auction fees prescribed in Clause 1 Article 3 of Circular No. 45/2017/TT-BTC excludes VAT but includes reasonable and valid expenses charged by auction companies for the property which have been put up for auction as prescribed.

In case of unsuccessful auction, the seller must pay to the auction company for reasonable and valid expenses as specified in the auction contract in accordance with Clause 2, Article 66 of the Law on property auction of Vietnam, but not exceeding the amount of auction fee in case of successful auction.

The seller shall come into an agreement with an auction company on fee and specific auction expenses and specify it in an auction contract according to the results of auction company selection and regulations on auction fees in accordance with the Law on property auction, but not exceeding the maximum and not less than the minimum of the fee bracket prescribed in Clause 1 Article 3 of Circular No. 45/2017/TT-BTC.

Within 20 working days from the date on which the closing day of auction, regardless of successful or unsuccessful case, the seller must pay to the auction company for fee or expenses associated with public notices on bulletin board, and other reasonable expenses prescribed in Clause 2, Article 66 of the Law on property auction; unless otherwise agreed upon by the parties or prescribed by law.

With regard to management and use of auction fee, Circular No. 45/2017/TT-BTC specifies that each auction company must put up notices of auction fee publicly according to each administrative division where the auction is held; comply with regulations of law on prices, property auction and their guiding documents.

Source: Finance Magazine

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